The Bankwatch

Tracking the consumer evolution of financial services

Wesabe Database helps Members Make Better Financial Decisions

I have looked at Wesabe before and considered the unique view it presents across consumers including their banking and spending patterns.

The information has grown significantly, and now contains information representing 1/2 billion dollars in transactions. Users can tag and rank their impressions of merchants and Banks.

The company gave several examples of how it is putting that data to work, revealing which major banks charge its members the most in overdraft fees (Wachovia and U.S. Bank). Wesabe also reported the types of member purchases that give the most satisfaction (outdoor and camping), and showed that purchases in industries where there is the least competition, such as phone, utilities and cable, give the least satisfaction.

Source: Wesabe

Examples of interest to this blog are banking related:

Tracking Overdraft Fees

Overdraft fees are a common frustration for consumers and a profit center for banks. In the seven months since Wesabe’s launch, members have paid more than $200,000 in overdraft fees alone. Following is a look at the average amount Wesabe members have paid in overdraft fees in the past seven months at five major U.S. banks (based on average number of overdrafts per account and average cost per overdraft):

1. Wachovia: $26.63 (0.99 overdrafts per account; $26.79 average fee)
2. U.S. Bank: $22.42 (0.70 overdrafts per account; $31.85 average fee)
3. Washington Mutual: $21.14 (0.76 overdrafts per account; $27.76 average fee)
4. Bank of America: $15.19 (0.48 overdrafts per account; $31.41 average fee)
5. Wells Fargo: $12.42 (0.38 overdrafts per account; $32.59 average fee)

Finally, the tags which exhibited the lowest satisfaction, show that lending generally is not handled well by firms.

The 10 tags with the lowest level of resulting satisfaction:

1. finance charge
2. fee
3. loans
4. dmv
5. phone
6. cable
7. utilities
8. creditcard
9. cellphone
10. electric

Relevance to Bankwatch:
Wesabe spend a lot of time and effort ensuring that security of the information is maintained. The value in this type of information can only grow as the service becomes more popular, but it already has a good critical mass. Wesabe is an example of a social network gathering information in a useful fashion, that exponentially greater value in aggregate.

I can see Banks, or any firm wanting to break out of the pack, and display satisfaction results for their firm, that is higher than their industry. The beauty of it, is that the only way to accomplish that feat is to have your customers be satisfied with your service, and become advocates of your service. And that satisfaction must be felt at the point of pain … when you pay for it.

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Written by Colin Henderson

June 14, 2007 at 07:08

Posted in Social networks

One Response

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  1. Why don’t banks offer applications like Wesabe? For example, as part of their online banking products.

    John Januszczak

    June 18, 2007 at 19:59

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